The Securities and Exchange Commission announced that the United States District Court for the Middle District of Florida entered a final judgment against Aerokinetic Energy Corporation and its president, Randolph E. Bridwell. The final judgment imposes disgorgement of ill-gotten proceeds, jointly and severally, in the amount of $555,000, plus prejudgment interest in the amount of $59,571.09. Additionally, Aerokinetic and Bridwell were ordered to pay civil penalties of $250,000 and $130,000, respectively.

Previously, the Commission filed an emergency action to halt Aerokinetic and Bridwell from ongoing fraud involving the sale of its common stock. Acting on the Commission’s request for emergency relief, Judge James D. Whittemore issued a temporary restraining order, an asset freeze over Aerokinetic’s bank account, and other relief against the defendants.

The Commission’s complaint alleged that Aerokinetic and Bridwell violated Sections 5(a), 5(c) and 17(a) of the Securities Act of 1933 and Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder, and that from at least September 2006 through July 2008, the defendants raised at least $535,000 from 24 investors nationwide (and sought to raise an additional $575,000) by conducting a fraudulent offering of unregistered securities in the form of common stock. Aerokinetic, a Sarasota company purportedly in the business of researching, developing, and marketing alternative power technologies and other innovative products, claimed to have developed new energy technologies, including a power generation station capable of creating electrical energy at a fraction of the cost of conventional or nuclear means, without generating any pollution. Defendants told investors and potential investors that they projected millions of dollars of sales revenue within Aerokinetic’s first years of operations and billions of dollars shortly thereafter.

In reality, Aerokinetic had no patents, license agreements, contracts, suppliers, customers, sales, revenue, or market share and its purported energy technologies and products were, at best, in the early development stage and, therefore, its predictions of imminent financial success and financial projections lacked any reasonable basis in fact. Moreover, contrary to defendants’ assurances that they would use investor funds to research and develop Aerokinetic’s products, the complaint alleged that Bridwell misappropriated investors’ funds to pay his personal expenses, with approximately $230,000 in investor funds unaccounted for.